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Views from the Center

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Dubai, Magnet for Foreign Workers, Could Do Better by Easing Labor Mobility Restrictions

The story of Dubai is remarkable. In six decades it has grown from a small fishing village to a gleaming metropolis with a per capita GDP comparable to that of the United States. In many ways, Dubai must be seen to be believed. Even its skyline is unreal–rising straight out of the desert and dominated by the tallest building in the world—the 2625 ft., 160-story, silver-and-glass Burj Khalifa.

Dubai's Labor Market - A Model for Other Countries?

Dubai has many unique features—it is a city state arising improbably out of the desert, boasting some extraordinary buildings, including a hotel shaped like an Arabian dhow and a 12 million sq ft shopping mall, with a fountain four times the size of the one at the Bellagio in Las Vegas.  But despite this uniqueness, its labor market policies may well serve as a model for other countries.  Dubai has actively sought talent from all corners of the world—its population of 1.7 million has four times as many foreigners as locals.  These guest workers staff hotels, drive cabs, build skyscrapers, a

Bail, Baby, Bail: What General Motors can Teach us about Policy Distortions

This is a joint posting with David Wheeler and Robin Kraft

When countries in Latin America or Africa descend into crisis, economists in Washington take a harsh view. Governments are forced to reduce spending in return for IMF rescue packages and in some instances, countries are even put on a cash-only budget. In the United States, we have a very different approach designed to minimize hardship of any kind -- the bailout.

Crisis a Set Back for Accountability and Good Governance in Developing World (Development Impacts of Financial Crisis)

I think the behavior of both public officials and private sector managers over the past decade is at direct odds with our message to the developing world regarding transparency and accountability. For example, my research shows that influence peddling is a serious impediment to growth in Africa, and that the development community needs to devise solutions that recognize and overcome such problems.

U.S. Financial Crisis Will Mean Slower Growth, Rising Inequality in Developing World (Development Impacts of Financial Crisis)

For many developing countries, the U.S. credit crisis will mean slower growth and rising inequality. The effects will be protracted, and not all will show up at the same time. And the nature and degree of impact will vary widely. Some countries, notably those with extensive foreign exchange reserves and strong fiscal positions, will be much better able to cope than others. But overall the crisis is very bad news for developing countries and especially for the poor.

Tiger, Tiger Burning Bright: The World Bank Undermines Own Conservation Efforts With Fossil Fuel Projects

This is a joint posting with Vijaya Ramachandran
The World Bank Group's board appears to be operating under a severe case of cognitive dissonance, supporting efforts to save tigers - threatened in India and Bangladesh by habitat loss due to climate change - while helping build coal-fired power plants that will only speed up this process.
Back in June the Bank launched a campaign to help governments develop and better manage forests inhabited by endangered tigers, including in the Sunderbans. This massive mangrove forest spans the India-Bangladesh border and is home to the Bengal tiger. While the Bank has a less-than-stellar conservation track record in Sunderbans, more important is the fact that this impoverished World Heritage site would be one of the hardest hit by climate change, whether from rising sea levels or the disappearance of the glacier that feeds the Ganges river.
But the Bank's commitment to poverty reduction and biodiversity stands in stark contrast to its bread-and-butter financing choices. As the Bank planned its save-the-tiger campaign, the International Finance Corporation (IFC), the Bank's private sector arm, was putting together a deal to finance $450 million of the misguided $4+ billion Tata Mundra Ultra Mega coal-fired plant in India. Financing 10% of the cost of a plant being built by India's largest company will help propel India's power sector emissions to third highest in the world within a few years, behind China and the U.S. Is this a smart use of scarce international public resources?

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